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Budget 2014: Savers in Suffolk will be a ‘paltry’ £19 a year better off with new combined tax-free Nisa, says Money Saving Expert Martin Lewis

PUBLISHED: 16:08 19 March 2014 | UPDATED: 16:09 19 March 2014

Chancellor of the Exchequer George Osborne holds the budget box

Chancellor of the Exchequer George Osborne holds the budget box

Savers in Suffolk will be able to put aside up to £15,000 a year tax free, the Chancellor announced today.

Revealing his 2014 Budget, Chancellor of the Exchequer George Osborne said the current cash ISA and the stocks and shares ISA will be combined to create a new ISA - Nisa.

Nationally, banks and building societies have hailed the move, with nationwide describing it as “much-needed support for ordinary savers”.

But Moneysavingexpert.com founder Martin Lewis said the benefits of the Nisa would be significantly held back by paltry interest rates available on cash deposits.

He calculated the additional tax gain from the increased limit would work out to just £19 a year more on the best deal in the market, which pays 1.65%, for basic rate taxpayers who invest the full £15,000.

He said: “While it’s a good long term gain, dig through the current numbers and the advantage of increasing the cash ISA limit from £5,940 to the new Nisa limit £15,000 isn’t as big as many will think.

“This is because you can’t ignore the fact that cash ISA rates are at all-time lows.”

Will you be taking advantage of the Nisa? Share your thoughts on the budget via Twitter today using #Budget2014 #Suffolk, or leave a comment below.

6 comments

  • It does strike me that cash ISAs are not all they're cracked up to be at the rates they offer are often lower than non-ISAs. However the NISA might well be useful for folk like me who are not interested in saving via stocks and shares.

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    Baptist Trainfan

    Wednesday, March 19, 2014

  • Surely this applies to the whole of the UK and not just for the people of Suffolk ?!

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    Sir Casm

    Wednesday, March 19, 2014

  • £19? My calculation is that the EXTRA amount permitted to be saved in a NISA is £15,000 minus the present (from April 5th) allowance of £5940 which equals £9060 extra allowance. At the 1.65% rate used that means interest on the £9060 is £150 p.a. Not paying tax at 20% saves £150 X 20% (15th) which is £30 ... not £19.

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    Johnthebap

    Wednesday, March 19, 2014

  • I think there is confusion between "investing" and "saving".

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    Ipswich Entrepreneur

    Wednesday, March 19, 2014

  • Where did he find "the best deal in the market, which pays 1.65%"? I'm assuming he's based in on someone starting off on an ISA for the first time and only having £15,000 in it from day one. My Cash ISA is at 1.85%. You can get fixed ISA (2 years I believe) at 2% and higher. Not much of an expert!

    Report this comment

    Chris Church

    Wednesday, March 19, 2014

  • £15,000 @ practically nothing % won't make much difference to what it is now.

    Report this comment

    Tony G

    Wednesday, March 19, 2014

The views expressed in the above comments do not necessarily reflect the views of this site

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